twopointouch

So Microsoft has tendered a bid to buy Yahoo! for $44.6bn.

I understand that Microsoft has to do something to build on its web strategy/presence. No-one uses Live Search, Live Spaces, or any of the rest. (OK. About one percent of people do). To build up any future trade for advertising, web services or development platforms, they have to increase market share.

I understand that Yahoo! has to do something. Their share of the search market is pitiful compared to the almighty Google. Their share of the search marketing budget is about 20% compared to Google’s 70%. And they’d just been forced to lay off a load of staff.

So if they combine forces, they end up with a market competitor?

I don’t think so.

Microsoft’s problem and Yahoo!’s has been that they have not been able to identify what they do well. Microsoft used to do operating systems and business productivity software. They were quite good at that. YMMV.

Yahoo! used to have this great directory of editor-approved, quality websites. Then they diversified. They tried to make yahoo.com all things to all wo/men. That failed disastrously because there’s no such thing. They brought on some cool people and acquired a load of cool sites like del.icio.us, flickr and upcoming. But still it didn’t work for them because advertisers don’t buy cool; they buy results. Yahoo! announced 1400 job losses just last week.

Why didn’t it work and why isn’t MS able to make any inroads on the web?

Because neither of them have a core value proposition when it comes to the web. You couldn’t sum up what either of them do on the web in one sentence. If a business can’t do that, then they are in trouble, normally.

Don’t get me wrong. There are bits within both companies’ web presence that have considerable value. Flickr is a cool photo site. Microsoft’s technet is actually very good, IMHO. Live Spaces is arguably a much better platform than Blogger or Vox.

However, for end-users, if you want good search, go to Google. For businesses, if you want SEM, go to Google. What exactly would you willingly go to a Yahoo or MS website for?

Microo! doesn’t appear to me to provide a compelling alternative to any of that.

Not really Web 2.0 or web-anything, but interesting nonetheless. News on Wednesday that Microsoft is threatening to pull out of China because of human rights’ violations.

The BBC quotes Fred Tipson, MS’ senior policy counsel, who says:

“Things are getting bad… and perhaps we have to look again at our presence there,” he told a conference in Athens.

“We have to decide if the persecuting of bloggers reaches a point that it’s unacceptable to do business there.”

“We try to define those levels and the trends are not good there at the moment. It’s a moving target.”

I’m interested in this, of course, because Google and Yahoo! have previously defended their decision to remain in China on the grounds that their presence is more likely to precipitate change and improvements than staying away. It will be interesting to see if Microsoft do indeed act against China, and if this propels action from other companies.

So sad, though, that it’s left to major corporations to take the moral stands our governments should be taking.